Featured Articles

Vacations and Home Improvement Top UHNW Expenditures

2/17/2014

Vacation, home improvements and automobiles are where Ultra High Net Worth investors spent the most money in terms of discretionary spending over the past 12 months. (Ultra High Net Worth investors are those with $5 million to $25 million of net worth not including their primary residence.)

A Spectrem study of wealthy investors – Asset Allocation, ProductOwnership and Perception of Providers – indicated that 48 percent of UHNW investors spent at least $10,000 on vacation or leisure travel. Eleven percent spent at least $25,000 on getting away from it all.

Thirty-nine percent of UHNW investors spent at least $10,000 on home improvements in the past 12 months, and 12 percent spent at least $25,000 on their abode. Thirty-two percent spent at least $10,000 on automobiles.

In contrast, 90 percent of UHNW investors spent less than $10,000 annually on household staff. And despite the perceptions of the “1 percent”, 30 percent of the UHNW do not have any household staff.

Seventy-three percent of the wealthiest investors do not gamble. Something the less wealthy should keep in mind?

When it comes to contributing, UHNW investors show more interest in charitable contributions than political ones. While 27 percent spent at least $10,000 on charitable contributions, only 3 percent spent that much on political contributions.

Younger investors are more interested in jewelry purchases than older investors. Thirty-six percent of investors under the age of 45 spent at least $10,000 on jewelry, and only 16 percent of investors between the ages of 45 and 54 did so. The percentage dropped to 12 percent among investors 55 to 64 and 4 percent among investors 65 and older.

Approximately half of all UHNW investors spend money on collectibles, but the age range is wide. Only 9 percent of investors 65 and older spent $10,000 or more on collectibles, while one-quarter of investors aged under 45 spent at least $10,000 and 9 percent spent at least $25,000.